Polaris 2010 Annual Report Download - page 25

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being reviewed by ROHVA. We are unable to predict the outcome of the CPSC rule-making procedure and the
ultimate impact of the procedure or any resulting rules on our business and operating results.
We are a member of the International Snowmobile Manufacturers Association (“ISMA”), a trade association
formed to promote safety in the manufacture and use of snowmobiles, among other things. ISMA members include
all of the major snowmobile manufacturers. The ISMA members are also members of the Snowmobile Safety and
Certification Committee, which promulgated voluntary sound and safety standards for snowmobiles that have been
adopted as regulations in some states of the United States and in Canada. These standards require testing and
evaluation by an independent testing laboratory. We believe that our snowmobiles have always complied with safety
standards relevant to snowmobiles.
Victory motorcycles are subject to federal vehicle safety standards administered by NHTSA. Victory
motorcycles are also subject to various state vehicle safety standards. We believe that our motorcycles have
always complied with safety standards relevant to motorcycles.
Our products are also subject to international standards related to safety in places where we sell our products
outside the United States. We believe that our Victory motorcycles, ATVs, off-road side-by-side vehicles and
snowmobiles have always complied with applicable safety standards in the United States and other international
locations.
Use regulation. State and federal laws and regulations have been promulgated or are under consideration
relating to the use or manner of use of our products. Some states and localities have adopted, or are considering the
adoption of, legislation and local ordinances that restrict the use of ATVs, snowmobiles and off-road side-by-side
vehicles to specified hours and locations. The federal government also has restricted the use of ATVs, snowmobiles
and side-by-side vehicles in some national parks and federal lands. In several instances, this restriction has been a
ban on the recreational use of these vehicles.
We are unable to predict the outcome of such actions or the possible effect on our business. We believe that our
business would be no more adversely affected than those of our competitors by the adoption of any pending laws or
regulations. We continue to monitor these activities in conjunction with industry associations and support balanced
and appropriate programs that educate the product user on safe use of our products and how to protect the
environment.
Emissions. The federal Environmental Protection Agency (“EPA”) and the California Air Resources Board
(“CARB”) have adopted emissions regulations applicable to our products.
The CARB has emission regulations for ATVs and off-road side-by-side vehicles that we already meet. In
2002, the EPA established new corporate average emission standards effective for model years 2006 and later, for
on-road recreational vehicles, including ATVs, off-road side-by-side vehicles and snowmobiles. We have devel-
oped engine and emission technologies along with our existing technology base to meet current and future
requirements. In 2002, we entered into an agreement with a German manufacturer to supply four-stroke engines that
meet emission requirements for certain snowmobile models. In 2008, the EPA modified the snowmobile emission
standards for model year 2012 and we have developed engine and emission technologies to meet these requirements
with the use of early reduction credits generated in prior model years. The EPA announced its intention to issue a
future rulemaking on snowmobiles in or around 2010 and any new emission standards under this rule are expected
to become effective after model year 2012.
Victory motorcycles are also subject to EPA and CARB emission standards. We believe that our motorcycles
have always complied with these standards. The CARB regulations required additional motorcycle emission
reductions in model year 2008, which the Company meets. The EPA adopted the CARB emission limits in a 2004
rulemaking that allowed an additional two model years to meet these new CARB emission requirements on a
nationwide basis. We have developed engine and emission technologies and met these requirements nationwide in
model year 2010.
Our products are also subject to international laws and regulations related to emissions in places where we sell
our products outside the United States. Europe currently regulates emissions from certain of our ATV-based
products and motorcycles and the Company meets these requirements. Canada’s emission regulations for
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